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Housing sales drop 11% in top 7 Cities in Q3 2024: Here’s what you need to know!

It may not feel like it yet, but the housing market's <a target="_blank" href="https://www.businessinsider.com/housing-market-ice-age-higher-home-prices-fewer-sales-inventory-2023-5">Ice Age</a> is finally thawing.Would-be buyers and sellers have found themselves stuck over the past couple of years. For-sale signs stood frozen in front yards as home shoppers balked at prices. Wild swings in mortgage rates discouraged almost everyone from venturing out into the market. Many <a target="_blank" href="https://www.businessinsider.com/economy-housing-market-mortgage-buying-car-interest-rates-new-jobs-2024-3">felt as if they had no option but to stay put</a>. But when I talk to housing experts these days, they speak cautiously of a shift in the weather, a warming in store for American real estate.Green shoots are popping up everywhere. The typical borrowing rate for a 30-year home loan is near the lowest it's been in two years, which could nudge more sellers to emerge from hibernation. The pool of available homes on the market is larger than at any point since the early days of the COVID-19 pandemic. While the median home price nationwide is up by 3% to 5% compared with a year ago, that's actually within the range that economists typically look for in a well-balanced market. If things keep trending this way, we should expect to see this coming spring, the time of year when transactions typically pick up, that more people are ready to get moving again.Would this mean we're back to normal? Definitely not. Things may be more stable than they were during the peak of the home-trading frenzy or the depths of the slowdown, but that doesn't mean the housing market's problems are solved. It'll be hard for both buyers and sellers to shake off the pessimism of the past few years, especially when budgets are stretched so thin and home prices remain so high. That reality shouldn't obscure the encouraging signals, though. As I wrote earlier this year, a <a target="_blank" href="https://www.businessinsider.com/denmark-mortgage-rates-lock-in-effect-home-buying-selling-easier-2024-5">gummed-up housing market</a> — the Ice Age I was talking about — is good for nobody. In half a year's time, we may be looking at a healthier one.There's a tendency to look at housing in binary terms: Is it a better time to be a seller or a buyer? But a lot of people fall into both camps; most sellers have to turn around and purchase another home to live in. Recently, this fact of life has created what Skylar Olsen, Zillow's chief economist, calls the "musical chairs" problem: People can't jump up and find a new home if their neighbors aren't making similar moves, so everyone's stuck in their seats.A big reason Americans find themselves trapped in place is what's known as the "lock-in effect." When mortgage rates hit multidecade lows during the pandemic, millions of people were able to snag or refinance their way into cheaper monthly costs. But starting in the spring of 2022, the rate for a typical mortgage soared, more than doubling from those pandemic-era lows. While it's come down from a two-decade peak last October, the prevailing loan terms are still about twice as expensive as they were back in 2021, which means a buyer could have to pay hundreds of dollars more each month toward interest than they would have a few years ago. A lot of people don't want to give up a good deal, so they don't make a change unless they absolutely have to. One paper from the Federal Housing Finance Agency suggested that the lock-in effect prevented a whopping 1.3 million home sales between mid-2022 and the end of 2023. A mere 2.5% of America's housing stock traded hands in the first eight months this year, according to Redfin, the lowest rate in at least three decades and 31% lower than in 2019.The recent drop in the typical rate for a 30-year loan — from about 7.2% in early May to 6.1% in early October — won't erase the lock-in effect, but it's an encouraging sign for buyers who have been grasping for anything that could ease the burden on their wallets. Even after a <a target="_blank" class="" href="https://www.businessinsider.com/mortgage-rate-increase-since-federal-reserve-cut-interest-rates-housing-2024-10">uptick in the last few days</a> following the unexpectedly strong jobs report, more interest-rate cuts from the Federal Reserve, which signaled last month that it was <a target="_blank" href="https://www.businessinsider.com/fed-rate-cut-explained-inflation-labor-market-conditions-outlook-recession-2024-9">turning its focus away from battling inflation</a>, could further bring down mortgage rates, <a target="_blank" href="https://www.businessinsider.com/personal-finance/mortgages/how-does-fed-impact-mortgage-rates">though there's not a direct connection between the two</a>. Fannie Mae, for instance, predicts the rate for a typical home loan could end next year at 5.7%. That'd be within spitting distance of what the experts at John Burns Research and Consulting, a housing-research firm, call the "magic mortgage rate." Among homeowners and renters who said they planned to use a mortgage to purchase their next home, 47% told the firm in September that they'd be willing to sign up for a rate between 5% and 5.49%. Even if rates continue their downward trajectory, changes in mortgage payments typically take about six months to show up in home-sales activity, Ralph McLaughlin, a senior economist at Realtor.com, told me. So movement now could set the stage for a stronger uptick in sales next spring. Fannie Mae has also predicted that the total number of sales will be up by 10% in 2025 compared with this year, with most of that increase coming in the second half of the year.<div type="image" title="house for sale sign" height="1414" width="2121" msid="114076822" hostid="261" sizebytes="84578"></div>While mortgage-rate movement can be a helpful guide for future activity, to get a full picture of what's actually happening in the real-estate market, you need to look at two data points: inventory, or the number of available homes on the market, and new listings, or the number of homes hitting the market. Olsen, the Zillow economist, likens inventory to a swimming pool and new listings to the spigot that keeps water flowing — as with any pool, too full or too empty is a problem. A balanced market is one in which there are enough new homes to meet the demand from buyers, but not so many that prices plummet. We're still a long way from refilling the pool of homes on the market: Inventory in September was down by about 23% from pre-pandemic levels, according to Realtor.com. But there is clear improvement taking place here, too. The number of active listings in September was up by 34% from the same month a year ago, increasing to its highest level since April 2020. The number of homes newly listed for sale in September was also up by 11.6% from last year. By slowing down home sales, higher rates have given inventory time to build back up from pandemic lows — homes are lingering on the market longer with fewer buyers, so the pool's water level has steadily climbed.More homes to choose from, lower mortgage rates — that's a "powerful combination," said Lawrence Yun, the National Association of Realtors' chief economist, adding that sales should move higher in the coming months as a result. Buyers can take heart in another data point, which is that far fewer homes are being snapped up as soon as they hit the market. According to the housing-data firm Altos Research, there were about half as many "immediate sales" in late September as there were in 2022. "It looks like that frenzy is finally gone," Altos' president, Mike Simonsen, said in a recent video update. The baseline expectation for the spring, the Redfin economist Chen Zhao told me, is a modest uptick in sales and new listings. Most economists don't expect mortgage rates to fall dramatically, meaning sellers will slowly start to reenter the market as they decide it's time to make a change. New listings this year increased by about 5% a month on average compared with the same months in 2023 — you might expect to see that climb a little next year, Zhao told me, to maybe 10% year-over-year growth. The total number of homes on the market each month tended to be about 10% or 15% higher than last year, but you might see that rise to 20% or 25% when you compare 2025 with this year. This is the housing's version of a soft landing; there won't be dancing in the streets, but it would be a marked improvement from the past couple of years."Even though the housing market is recovering, the recovery is going to be very slow," Zhao told me. "We're not going to see anything like the activity that we saw in 2021 or 2020 — or even 2019, 2018 — for a while."Still, if buyers are feeling better about their prospects, that should grease the wheels of America's housing market.It is important to note that forecasts are just forecasts. There's a lot that could change in the next year. The <a target="_blank" href="https://www.businessinsider.com/hiring-slump-professional-white-collar-jobs-recession-high-salary-2024-4">strength of the job market</a> is a big question mark — people won't move if they don't feel sure about their next paycheck. There are huge regional differences to consider here, too. Builders have finished a lot more new housing in Sun Belt states in the lower half of the US, for example, which has made it harder for homeowners there to sell at their desired prices than for their counterparts in the Midwest or the Northeast. Affordability is still a huge pain point. An August survey by Fannie Mae suggested consumers were feeling remarkably optimistic about the future of mortgage rates, but only 17% of respondents said it was a good time to buy a home. Any one of these issues could chill the market and slow America's exit from the Ice Age.That said, it's impossible to ignore the signs of a shift underway. Mortgage rates are a key piece of the equation. I'll also be keeping a close eye on inventory and the pace of new listings hitting the market, which should heat back up starting around February and March. But all this focus on the numbers can obscure the simple fact that people have to move for all kinds of reasons that have nothing to do with a few digits and a percent sign.I recently spoke with Mark Palim, the chief economist at Fannie Mae, who left me with a salient piece of advice: "Leave timing the bond market to the hedge-fund guys." In other words, trying to predict mortgage rates — and buying or selling a home accordingly — is a fool's errand. Budgets matter, absolutely, and monthly payments are a crucial consideration for any buyer. But buyers and sellers should remember that their home isn't just an investment vehicle or a bet on where the economy is headed. At the end of the day, you have to live in it."All sorts of things can happen," Palim told me. "Rates may move. Home prices may go up, home prices may go down. But would you be happy living there for a while? Does it meet your needs?"<a target="_blank" rel="" href="https://www.businessinsider.com/author/james-rodriguez">James Rodriguez</a> is a senior reporter on Business Insider's Discourse team.

The Housing Ice Age is thawing

<ul class="summary-list"><li>BYD has just notched another big victory in its fight to overtake Elon Musk.</li><li>The Chinese EV maker's quarterly revenues outstripped Tesla's for the first time.</li></ul><a target="_blank" class="" href="https://www.businessinsider.com/byd-founder-wang-chuanfu-biggest-chinese-global-ev-automaker-2024-1">BYD</a> has just scored another victory in its battle to overtake <a target="_blank" class="" href="https://www.businessinsider.com/tesla">Tesla</a>.The Chinese EV giant said in its third-quarter earnings on Wednesday it had surpassed Tesla's revenues from EV sales for the first time.BYD recorded revenues of 201.1 billion yuan ($28.2 billion) in the three months to September 30, up 24% from the same quarter last year. <a target="_blank" class="" href="https://www.businessinsider.com/tesla-stock-tsla-earnings-call-report-live-updates-2024-10">Tesla posted sales of $25.2 billion</a> over the same period.It's another marker for the industry juggernaut, which has ridden China's EV boom to become one of the country's largest automakers.BYD briefly <a target="_blank" class="" href="https://www.businessinsider.com/ken-griffin-on-chinas-byd-ev-outperforming-elon-musks-tesla-2024-1">overtook Tesla as the world's biggest EV producer</a> at the end of last year, and after a record quarter, is aiming to put <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk">Elon Musk</a>'s company under further pressure.Here are five reasons BYD is booming:<h2 id="d2ed0127-4943-4c97-9993-210cd5715665">1. Affordable EVs</h2>BYD is known for its cheap electric vehicles, and has spent this year making them cheaper.The automaker launched a <a target="_blank" class="" href="https://www.businessinsider.com/byd-china-ev-price-war-yuan-plus-tesla-elon-musk-2024-3">wave of price cuts earlier this year</a>, which included lowering the price of the <a target="_blank" class="" href="https://www.businessinsider.com/byd-cheap-ev-seagull-coming-to-europe-china-us-tariffs-2024-5">ultra-cheap Seagull hatchback</a> to under $10,000.Those price cuts gave BYD an advantage over Tesla, whose cheapest vehicle in China is the 231,900 yuan ($32,600) Model 3, and appear to have spurred sales.BYD announced record monthly deliveries on Friday, with the company selling half a million passenger vehicles in October.<h2 id="e64c7ec7-70d2-498e-9c45-48cb9cbdfad2">2. Luxury vehicles</h2>As well as making their cheapest cars cheaper, BYD has expanded into luxury vehicles.<div type="image" title="Yangwang U9" height="2667" width="4000" msid="114857774" hostid="261" sizebytes="618384"></div>The automaker launched <a target="_blank" class="" href="https://www.businessinsider.com/luxury-european-carmakers-china-sales-competition-electric-vehicles-bmw-mercedes-2024-10">the Yangwang U8</a>, a $150,000 premium SUV that comes with an onboard drone last year.BYD also <a target="_blank" class="" href="https://www.businessinsider.com/byd-electric-supercar-u9-cost-ferrari-vibes-2024-2">unveiled its first supercar</a>, the 1.68 million yuan ($235,000) Yangwang U9, in February.The expansion of local automakers into China's premium market has put <a target="_blank" href="https://www.businessinsider.com/luxury-european-carmakers-china-sales-competition-electric-vehicles-bmw-mercedes-2024-10">pressure on European giants like Mercedes and BMW</a>. Experts told BI that this would enable firms like BYD to target less price-sensitive customers and grow beyond China's brutally competitive mass market.<h2 id="abc6d5cc-26e9-4f5e-97a0-116de874ee95">3. Global expansion</h2>BYD has embarked on an ambitious expansion drive this year to boost sales outside China. Executives have said they want half of BYD's sales to come from abroad in the future.Though US and European tariffs on Chinese EVs make selling in these regions problematic, BYD is <a target="_blank" href="https://www.businessinsider.com/byd-saic-chinese-ev-makers-plot-world-takeover-2024-6">rapidly setting up factories worldwide</a> to cut costs and avoid trade barriers. It's also focusing on emerging markets such as Mexico and Brazil.<h2 id="95ef07ab-209d-40a4-8311-9fa326be69ed">4. Hybrids</h2>A key part of BYD's success is its hybrid range. Unlike its rival, Tesla, BYD also offers a selection of hybrid vehicles, which are popular in China.Some 311,000 of the 500,000 passenger vehicles BYD sold in October were hybrids, with hybrid sales rising by 62% year-on-year.<div type="image" title="BYD Seal" height="4024" width="6048" msid="114857772" hostid="261" sizebytes="511534"></div>BYD has sold nearly two million hybrid vehicles this year. The automaker says its latest hybrids can go up to <a target="_blank" class="" href="https://www.businessinsider.com/byd-new-hybrid-cars-1250-miles-nonstop-gas-charging-2024-5">1,250 miles without stopping for gas or charging</a>.Dylan Khoo, an analyst at technology intelligence firm ABI Research, told BI the core of BYD's success this quarter stemmed from plug-in hybrid electric vehicle (PHEV) sales in China."Newly launched models based on BYD's fifth generation DM-i PHEV technology have been huge sales successes," he said.<h2 id="f1637504-ae75-4bb3-8d4a-af997966f543">5. Vertically integrated supply chains</h2>The core of BYD's success — and part of the reason it can produce EVs so cheaply — is that it tries to make almost every component in-house.BYD produces its own batteries and computer chips. BYD executive VP Stella Li recently told MotorTrend that BYD manufactures every component of its Dolphin electric hatchback, apart from the tires and windows.<div type="image" title="BYD executive vice president Stella Li" height="2668" width="4000" msid="114857770" hostid="261" sizebytes="387636"></div>"BYD's high degree of vertical integration — making rather than buying many key strategic components — means it can control production of batteries and chips and can do so at very low cost," said David Bailey, professor of business economics at the University of Birmingham.BYD did not respond to a request for comment from BI.

5 reasons BYD is surging ahead after eclipsing Tesla's quarterly sales for the first time

<ul class="summary-list"><li>My family put on a giant garage sale after cleaning out my grandmother's house.</li><li>We all contributed items, and it helped me rethink my relationship to clutter.</li></ul>This summer, three generations of my family — from my grandmother to my mom and aunts down to me — got together at my grandmother's house to put on a two-day <a target="_blank" href="https://www.businessinsider.com/best-tips-finding-valuable-treasure-yard-estate-sales-2022-12">garage sale</a>. The goal was to declutter my grandmother's house, which has been bursting with things since she moved in many decades ago, and other family members also joined the cause.It took massive effort and we all had to work together, but it was worth it.<h2 id="1b8f62cc-8bd5-4ac4-9c29-c2294708de3e">We spent a lot of time organizing the garage sale together</h2>All three generations of my family combined our things for the two-day garage sale, where we grouped items, laid them out on tables, and invited neighbors and passersby to peruse. The garage sale took massive organization between the family to pick a weekend and gather all the items together.My mom and aunts had cleaned out their basements, my brother found <a target="_blank" href="https://www.businessinsider.com/decluttering-kids-toys-play-kitchen-2024-5">toys from his childhood</a> he was willing to part with, and I had scanned my apartment up and down, ready to part ways with things that no longer served me and were the reason I couldn't close my closet.The night before the sale, we coordinated a sticker price system and grouped the items based on their category and use, from holiday items to gardening items, dishware, and books. Each family member could pre-shop the sale if one member got rid of something another wanted.We had to keep each other in check so no family member left with more items than they put into the pile, which would have rendered the <a target="_blank" href="https://www.businessinsider.com/decluttering-cleaning-tips-home-closet-2024-8">decluttering</a> useless. We also shared memories about the items, remembering where we got mugs from, and laughing about old Halloween costumes and decorations.<div type="image" title="Meredith Wilshere's family is standing outside and smiling." height="858" width="1144" msid="113062946" hostid="261" sizebytes="78652"></div><h2 id="6a14a6bc-c250-463b-86dc-a09279f3e188">It made me think about what I was holding onto and why</h2>The garage sale took a lot of coordination, but it was worth it once people started arriving and shopping for the sale. A few people arrived an hour early to get their hands on the more valuable items before the others could. Couples, families, people walking by, and locals all stopped by to look at the items, talk with members of my family, and even reminisce about their garage sales.The process of going through things to sell was hard and made me <a target="_blank" href="https://www.businessinsider.com/rent-house-extra-income-declutter-happier-2024-9">think critically about what I was holding onto</a>. Why was I holding onto those items? Was it because I used them frequently, or was it sentimental? I have dreams of one day owning a house with a grand library, but prepping for it and stocking it now isn't practical for my NYC apartment.Like many members of my family, I had to think about what we were actually still using and whether certain items would have a new life in someone else's hands while we were decluttering. In the essence of Marie Kondo, we kept asking ourselves, did these items still spark joy? Could they spark more joy for someone else? More often than not, the answer to the second question was "Yes."<h2 id="74daaff9-19d4-4eaf-a964-c0c950671442">I loved seeing new people enjoy our things</h2>While it was hard to let go, giving these things new life was meaningful. One woman talked about how the flower pots she bought would be a gift to a friend. A teacher purchased school supplies for the children in her class <a target="_blank" href="https://www.businessinsider.com/couldnt-afford-childcare-daughter-started-kindergarten-early-2024-2">starting school</a> in the fall. We could already see the joy the items were bringing to their new owners.There was a mom who came to the sale with her two children. While she was going through the books, her kids took to one of the playsets my brothers and I used to love playing with. They were already having fun with little figurines, playing with all the different parts, and acting out little scenes. My brother and I thought back to how much fun we had playing with that playset, and we were excited to see it go to a new family who would love it as much as we did.While the garage sale was a lot of work for the whole family, and we won't be putting on another one in the near future, it made us all <a target="_blank" href="https://www.businessinsider.com/moving-smaller-house-decluttering-tips-2024-7">think critically about decluttering</a> and letting things go. It helped us connect with the community, give our items new life, and clear up space in our homes.

My family decluttered my grandmother's house and organized a huge garage sale. It helped me clean my own apartment.

<ul class="summary-list"><li>A tough US housing market is weighing on sales of pricey home appliances.</li><li>Appliance maker Whirlpool slashed guidance in its recent earnings release, citing weak housing market activity.</li></ul>The US housing market is tough for buyers, and the slowdown in sales activity means Americans are spending a lot less on big, pricey appliances these days.In its latest earnings, Whirlpool cut its full-year outlook, adjusting annual earnings guidance to $12 a share, down from a range of $13-$15 as sales of big-ticket items slow.Whirlpool's North American major appliance sales fell 5.7% year-over-year, hurting earnings even as the segment's sales in Latin America and Asia grew by 11.3% and 19.7%, respectively.Whirlpool stock is down about 17% year-to-date, and was trading at $100.65 per share on Thursday. CEO Marc Bitzer attributes the fall in sales to a tough real estate market. In June, US home sales<a target="_blank" href="https://www.businessinsider.com/housing-market-outlook-logjam-existing-home-sales-record-prices-mortgages-2024-7"> hit their lowest level since 2010</a>, declining 5.4% from May to June according to<a target="_blank" href="https://www.nar.realtor/newsroom/existing-home-sales-slipped-5-4-in-june-median-sales-price-jumps-to-record-high-of-426900"> data from the National Association of Realtors</a>.Meanwhile, median home prices soared 4.1% year-over-year to $426,900, marking a consecutive monthly record."You have a consumer who's somewhere navigating between inflation, interest rate increases, global wars and an election campaign which seems to be played on doomsday scenarios. So that does not help consumer confidence," Bitzer said in an interview with <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-07-24/whirlpool-cuts-earnings-forecast-as-appliance-sales-remain-weak">Bloomberg</a>.On the earnings call, Bitzer said the company expected the Fed to cut rates at some point this year to ease home prices, but those cuts have yet to materialize."There's no doubt that we have been and still are at a low point in the US housing market. With interest rate reductions, this will ease at some point and we are well-positioned to benefit from improving demand," he said.Fed officials have <a target="_blank" href="https://www.businessinsider.com/fed-rate-cuts-outlook-inflation-target-economy-waller-barkin-williams-2024-7">hinted at a September cut,</a> and markets are eyeing as many as three cuts through the rest of this year as the soft-landing scenario of steady economic growth and disinflation materializes.

The tough US housing market is hurting sales of big-ticket home appliances, Whirlpool says

<ul class="summary-list"><li>This post originally appeared in the Insider Today newsletter.</li></ul>Welcome back to our Saturday edition! You're not alone if you've ever struggled to make a big decision. <a target="_blank" href="https://l.businessinsider.com/a/click?_t=c8e10479a20f45bba5aad6c5f6fbb009&amp;_m=jJeZDpQ5LFdu1VE4quxuwu6Q7P0VhndRCz&amp;_e=doU61fwFuDpa5cD8msoAaf7qbWHRaYx2QIdanbuDEFVo4Y5qvOPnMv7p5nl7teUh86J1MPHee4c4Cf9bEU8ltT7NweVAFxzrNQ45SdhlXNC4593R24JbBUmazNU6tRNZM7mCbX4VzZqlOxpND32Rlwb1WlPyiUGrVvIKsc1XqzDu1R2aF9kb7RltbXwFkzQ3c6Gx22cCX9GdtLkxzhjSpbA8XkIPOGMxmPRDQpQfPw04uGGgcbElKKIOboUks7ifkYcGkUorcVSJG8KALTARmtpp8365l2p283j4b7IxtiUXEgEtdkeymswzmoNk8JUNauIREW3KkriCXy5bNUaRv5UAOtEAyv6V-52vojZldM0YRQzaZHZ4dg-qStzjcShKhKceGbP6Fva3idFtFy-zsazcM-11E1IgZFJBkcTFW7A41ql_5vr6EdHDMG0mbzIU6JX8QTXSQHGpI8P3B0Tp0A%3D%3D">Shailene Woodley credits George Clooney</a> for accepting a multi-year contract after being "scared to say yes" to the "Divergent" series. The films went on to make $346 million at the box office.On the agenda:<ul><li>Their dreams of post-retirement RVing backfired. <a target="_blank" href="https://www.businessinsider.com/best-way-take-retirement-road-trips-owning-rv-cons-campervan-2024-9">They made a better plan</a>.</li><li>Jackson Hole's first adults-only hotel is <a target="_blank" href="https://www.businessinsider.com/hotel-yellowstone-jackson-hole-wyoming-adults-only-review-2024-9">a Western masterpiece</a>.</li><li>Millennials and Gen Zers are <a target="_blank" href="https://www.businessinsider.com/millennials-gen-z-tracking-parents-location-sharing-phones-helicopter-parenting-2024-9">helicopter parenting their own parents</a>.</li><li>How Austin fixed the <a target="_blank" href="https://www.businessinsider.com/austin-home-prices-falling-texas-mortgage-rates-housing-crisis-success-2024-9">soaring cost of home ownership</a>.</li></ul>But first: Ozempic is pricey.If this was forwarded to you, <a target="_blank" href="https://www.businessinsider.com/subscription/newsletter/insider-today-sunday-edition">sign up here</a>. Download Insider's app <a target="_blank" rel="" href="https://www.insider.com/app">here.</a><h3 id="2d2d81c1-e984-4ab1-b11e-26ada0d3da0b">This week's dispatch</h3><h2 id="c0df5ff0-0e14-4166-ab1b-1ab667d432bb">The high cost of weight-loss drugs</h2><div type="image" title="An Ozempic pen between interlocked hands" height="1000" width="2000" msid="113766329" hostid="261" sizebytes="596348"></div>Why are two popular weight-loss drugs — Wegovy and diabetes medication Ozempic — so expensive in the US? That's the question Novo Nordisk CEO Lars Fruergaard Jorgensen was grilled on this week by politicians in Washington, DC.Sen. Bernie Sanders pointed out during Wednesday's hearing that <a target="_blank" href="https://markets.businessinsider.com/news/stocks/novo-nordisk-ceo-faces-senate-questions-over-high-prices-of-ozempic-and-wegovy-in-us-1033798280">Ozempic costs</a> an average of $969 monthly in the US, compared to $59 in Germany. Wegovy averages $1,349 a month in the US, while in Germany, it's only $140.I spoke to Business Insider's senior health reporter Gabby Landsverk about what this means for American consumers.So, to ask the big question: Why are these medications so much more expensive in the US?That's business as usual. In other countries, government agencies negotiate with drug companies so consumers pay less.Here, we have middlemen — pharmacy benefit managers — who are supposed to do that negotiating. But the Federal Trade Commission, which has been conducting a years-long inquiry into this system, <a target="_blank" href="https://www.ftc.gov/news-events/news/press-releases/2024/09/ftc-sues-prescription-drug-middlemen-artificially-inflating-insulin-drug-prices">recently alleged</a> that these managers keep prices high to pocket the profits.How is the cost of these meds affecting how people actually use and access them?People who <a target="_blank" href="https://www.businessinsider.com/what-its-really-like-find-affordable-weight-loss-drugs-patient-2024-9">can't afford to pay $1,000 a month for meds</a> often end up trying to ration their supply or microdosing it. Patients also bargain-hunt for cheaper weight-loss drugs online, or try to use manufacturer-issued coupons.Telehealth companies, like Ro and Henry Meds, help patients wrangle insurance to try to cover brand-name drugs. They also offer <a target="_blank" href="https://www.businessinsider.com/buy-compounded-semaglutide-online-risks-wegovy-ozempic-2023-1">discounted versions</a> of the drugs that contain the same active ingredient as Ozempic and Wegovy. There is some regulation, though the products aren't FDA-approved so there's risk involved.The drug companies aren't happy about the competition. Eli Lilly, which makes Mounjaro and Zepbound, even launched its own <a target="_blank" href="https://www.businessinsider.com/eli-lilly-cut-price-zepbound-tirzepatide-weight-loss-drug-copycats-2024-8">half-price weight-loss product</a> and telehealth service to fight back against copycats.<h2 id="cc30e20d-acf4-4a4e-ad8f-02c3a04a9dbb">Rethinking RVing</h2><div type="image" title="RV" height="1022" width="1364" msid="113766323" hostid="261" sizebytes="415908"></div>Marie L. Mangin and her husband always dreamed of getting a camper van and going on epic road trips in retirement. But things went south after finally buying an RV, which they found to be too small and pricey to be sustainable.The couple pivoted — but never gave up on their road-trip dreams. They sold the camper and found a mode of transportation that works for them.<a target="_blank" href="https://www.businessinsider.com/best-way-take-retirement-road-trips-owning-rv-cons-campervan-2024-9">What they're doing instead</a>.Also read:<ul><li><a target="_blank" href="https://www.businessinsider.com/rv-mistakes-beginners-make-according-to-seasoned-van-lifers-2021-8">The biggest mistakes beginners make when traveling in an RV, according to RV lifers who have traveled to all 50 states</a></li></ul><h2 id="f3efdf5d-fcfc-4813-9e6c-8e3b9040c25d">Welcome to Hotel Yellowstone</h2><div type="image" title="Two chairs on a balcony face a view of mountains on a cloudy day" height="2560" width="3840" msid="113766325" hostid="261" sizebytes="641390"></div>Jackson, Wyoming's first adults-only hotel opened in August. BI's travel reporter spent a night at the boutique property, which quickly claimed the spot as one of her favorites.With a private balcony overlooking the Tetons and tasteful Western interior design, the room exudes luxury.<a target="_blank" href="https://www.businessinsider.com/hotel-yellowstone-jackson-hole-wyoming-adults-only-review-2024-9">See inside the new hotel</a>.Also read:<ul><li><a target="_blank" href="https://www.businessinsider.com/jackson-hole-airport-wyoming-national-park-review-2024-9">I flew into the only airport inside a US national park. It felt more like a luxury hotel lobby than a terminal</a>.</li></ul><h2 id="4e812ecf-a060-401e-9848-be206a63cddb">Find my parents</h2><div type="image" title="two hands each holding a phone with a security camera pointing at each other with a cutout of a map in the background" height="1000" width="2000" msid="113766321" hostid="261" sizebytes="173814"></div>Parents have long used location-tracking apps to keep tabs on their kids. Now, millennials and Gen Zers are turning the tech back onto their parents.Some adult children are using apps like Apple's Find My and Life360 to track their parents' whereabouts. For some families it can be a fun way to stay connected. But if things go awry, location sharing can easily turn into an invasion of privacy that family members come to resent.<a target="_blank" href="https://www.businessinsider.com/millennials-gen-z-tracking-parents-location-sharing-phones-helicopter-parenting-2024-9">Meet the helicopter kids</a>.<h2 id="483172dd-9e06-415f-8357-1bdb6f813f7b">A boom-bust to copy-paste</h2>Austin's real-estate market was on fire during the pandemic, but the boom went bust within a couple of years. Now, home prices are down compared to where they were a year ago.Still, the boom-bust cycle will be good for Austin in the long run. There might be short-term pain for those who bought at the peak, but the city gets one major benefit: More housing supply, which will avert an affordability crisis. Other cities could stand to take a page out from the Lone Star playbook.<a target="_blank" href="https://www.businessinsider.com/austin-home-prices-falling-texas-mortgage-rates-housing-crisis-success-2024-9">How Austin slashed home prices</a>.<h2 id="5fef756b-4b6b-4037-8f33-9635854b9d8b">What we're watching this weekend</h2><div type="image" title="A television showing Inside Out 2" height="1500" width="2000" msid="113766324" hostid="261" sizebytes="302308"></div><ul><li>"Inside Out 2": The Pixar sequel, which broke records to become the <a target="_blank" href="https://www.businessinsider.com/highest-grossing-animated-movies-all-time">highest-grossing animated movie of all time</a>, is now on Disney+.</li><li>"Oddity": Forget <a target="_blank" href="https://www.businessinsider.com/longlegs-ending-explained-lee-harker-nicolas-cage-killer-satan-2024-7">"Longlegs"</a> — the actual best horror movie of the year is streaming on Shudder.</li><li>"The Great British Baking Show": Ready, set, bake! The 12th installment of the beloved baking show just premiered on Netflix.</li></ul><a target="_blank" href="https://www.businessinsider.com/best-shows-movies-streaming-netflix-hulu-disney-plus-september-27-24">See the full list</a><div type="image" title="A red shopping bag surrounded by $100 bills." height="1500" width="2000" msid="113766327" hostid="261" sizebytes="244828"></div><h2 id="a09a70ef-5e7e-4bf4-80b2-3731f70bdc6e">Deals we love</h2><ul><li>Calling all Madewell shoppers: The <a target="_blank" href="https://businessinsider.com/guides/deals/madewell-insiders-event-sales-deals-2024-9">bi-annual Madewell Insiders sale is here</a> with 25% off almost everything full-price and an additional 40% off sale. Sign up with your email and save big on some of our favorite denim and basics.</li><li>It's spooky season: Fall is officially here, so it's time to let our guide to <a target="_blank" href="https://www.businessinsider.com/guides/home/best-halloween-decorations">the best Halloween decorations</a> inspire you. From tabletop centerpieces to ghostly candles, we're here to help you get the creative juices flowing.</li><li>iPhone 16 hot take: Our senior tech reporter explains in his <a target="_blank" href="https://www.businessinsider.com/guides/tech/iphone-16-review">iPhone 16 review</a> why you might not need to upgrade from the base model to the Pro version.</li></ul><h2 id="3a2e4b99-8063-4f80-8653-d1ec4a2af89a">More of this week's top reads:</h2><ul><li>We spent $275 at Fleming's Steakhouse. It's better suited for <a target="_blank" href="https://www.businessinsider.com/is-flemings-prime-steakhouse-worth-it-for-two-2024-9">business dinners than date nights</a>.</li><li>A 70-year-old who got into weightlifting explains <a target="_blank" href="https://www.businessinsider.com/70-year-old-lost-weight-start-strength-training-tips-fit-2024-9">how she lost 70 pounds</a>.</li><li>Millennials and Gen Zers share their top <a target="_blank" href="https://www.businessinsider.com/hidden-gem-travel-destinations-gen-z-millennials-recommend-2024-9">hidden-gem travel destinations</a>.</li><li>I paid $120 for a fine-dining experience narrated by AI. <a target="_blank" href="https://businessinsider.com/trying-ai-fine-dining-tasting-menu-venhue-new-york-2024-9/">High-brow restaurants should take notes</a>.</li><li>The US' top supplement expert takes <a target="_blank" href="https://www.businessinsider.com/us-top-supplement-expert-takes-3-supplements-busy-2024-9">these three when he's busy</a>.</li><li>A mom describes the differences in quality of life <a target="_blank" href="https://www.businessinsider.com/moving-us-to-switzerland-better-quality-of-life-staying-abroad-2024-9">between Switzerland and the US</a>.</li><li>Step inside a 5-star resort in one of <a target="_blank" href="https://www.businessinsider.com/panama-santa-maria-resort-jack-nicklaus-golf-course-review-2024-9">Panama City's wealthiest neighborhoods</a>.</li><li>Traveler who's been to over 50 countries ranks <a target="_blank" href="https://www.businessinsider.com/favorite-country-from-frequent-traveler-asia-kyrgyzstan">this Central Asian gem as one of her favorites</a>.</li></ul>Aldi shoppers have spoken: These are the <a target="_blank" href="https://www.businessinsider.com/best-products-aldi-right-now-fan-favorite-awards-2024-9">best things to buy at the chain right now</a>.The Insider Today team: <a target="_blank" href="https://www.businessinsider.com/author/dan-defrancesco">Dan DeFrancesco</a>, deputy editor and anchor, in New York City. <a target="_blank" class="" href="https://www.businessinsider.com/author/jordan-parker-erb">Jordan Parker Erb</a>, editor, in New York. <a target="_blank" href="https://www.businessinsider.com/author/lisa-ryan">Lisa Ryan</a>, executive editor, in New York. <a target="_blank" class="" href="https://www.businessinsider.com/author/amanda-yen">Amanda Yen</a>, fellow, in New York. Grace Lett, editor, in Chicago.

Insider Today: Austin's genius housing fix

<ul class="summary-list"><li>In October 2023, Isaac French sold his micro-resort for $7 million.</li><li>French, who built the property for $2.5 million, said the price of the sale was right.</li></ul>This as-told-to essay is based on a transcribed conversation with Isaac French, 27, about selling his Texas-based micro-resort in 2023. Business Insider has verified the sale of the property with documentation. The following has been edited for length and clarity.I had a dream to create a village of Nordic-inspired cabins in the heart of Texas.I found a five-acre parcel of land in Waco on Zillow, just a few miles from my home. In March 2021, I purchased the land using a short-term loan and personal savings for $138,000.In nine and a half months, I managed the design and construction of a seven-unit <a target="_blank" class="" href="https://www.businessinsider.com/starting-successful-tiny-house-airbnb-business-tips-2023-1">micro-resort</a> with an immersive natural setting. I financed the build with a construction loan from a local community bank and through raising equity from friends and family. It cost $2.5 million to build, including a container pool and hot tubs, which we added later on.We launched in January 2022. A travel influencer who marketed the resort on Instagram helped us go viral and generate a huge number of bookings. It was like an instant goldmine.We went all in on Instagram, growing the brand through creating content and partnering with influencers. Some of our early guests became superfans, coming back multiple times a year and bringing others with them. In our first 12 months of being open, we brought in $860,000 in bookings.The entire time we operated the business, I kept in mind that if someone came and offered the right price and terms, I'd consider selling it. I believe that every material possession should have a price tag attached to it.I sold the property, called <a target="_blank" class="" href="https://www.businessinsider.com/tiny-house-airbnb-hotel-waco-texas-see-inside-2022-10">Live Oak Lake</a>, for $7 million in October 2023. I learned a lot about securing a deal, including the value of having a good broker and attorneys.<h2 id="25fde6b5-f457-43bf-be94-6ce8e4254041">The uniqueness of the property helped us get a good price on the sale</h2>Live Oak Lake was like my baby. I built it from the ground up.The first three months after we opened were challenging. I was learning how to integrate <a target="_blank" class="" href="https://www.businessinsider.com/real-estate-passive-income-hospitality-short-term-rental-airbnb-2024-10">property management software</a>, and my wife was doing the cleaning. We hired a part-time cleaning and guest communications manager and a part-time operations manager, who then ran the property after the first few months.I was then spending around five to 10 hours a week on the business, mostly doing marketing. Because you're open for business 24/7 in hospitality, some of those hours were late at night when guests were arriving late. I was doing personal branding and coaching alongside the hotel. My wife and I also did mission work with our church.Part of the reason I considered selling Live Oak Lake was because of the stress of running it. Even though I automated elements for efficiency, in <a target="_blank" class="" href="https://www.businessinsider.com/hiring-jobs-restaurants-hotels-leisure-hospitality-healthcare-government-2024-7">hospitality</a>, the guest experience is paramount. I was focused on blowing guests away and wanted to look at every single review. It was hard to unplug from the business.We listed Live Oak Lake for sale in the summer of 2022. Several parties were interested, but we felt the property was worth more. We removed that listing and raised the price by $1 million when we next listed in January 2023.A broker who specialized in outdoor hospitality reached out and helped me from there. When we relisted the property, the broker helped vet the interested parties.We were about to <a target="_blank" class="" href="https://www.businessinsider.com/best-sales-tips-for-closing-deals-faster-2016-5">close on a deal</a> for $6.5 million, but the buyers backed out the day before we were set to close. It was an emotional roller coaster.A few days later, we received another offer for $7 million from a private group of investors, which we were able to close on. The property is being run similarly to before, and some of my friends who I hired to manage things on the ground still work there.I think the uniqueness and novelty of the property, the audience we built, and the quality of the hospitality we offered helped us sell for that price.We weren't in a hurry to sell, but $7 million was a lot of money. Plus, I hit it off with the buyer and liked their vision. I felt they understood what made us special, like our social media following, direct bookings, and unique experience.<h2 id="c7a0c906-c322-4402-99d2-bf69962ff44c">I learned a valuable lesson about selling a property</h2>One thing I learned from the selling process was the importance of having good attorneys and a great <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/mortgages/how-to-find-real-estate-agent">broker</a>.Our broker was local, which was a huge help. There were a lot of <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/mortgages/home-inspection">property inspections</a> and meetings with prospective buyers. He could help with those things without me having to drop everything.He alleviated my emotional volatility and attachment to the property because I didn't have to be involved in every interaction. I'm a very detail-oriented person who likes to micromanage things. I needed to trust other people, like my attorneys and the broker, who could take my hands off of the selling process. I'd highly recommend getting a broker to anyone <a target="_blank" class="" href="https://www.businessinsider.com/homebuilders-new-construction-rental-homes-investors-price-cuts-mortgage-rates-2024-11">selling a property</a>.<h2 id="f9154a67-a1d5-4e4c-a88c-c48ff6eebfa6">Selling the property has alleviated my stress</h2>I think I sold Live Oak Lake at the right time. I held the property just long enough to gain thorough experience operating a micro-resort and build it to a point where it was really valuable.Selling has alleviated stress in my life. I have an office and art studio in my backyard, where I can now work on other ventures as and when I want. I consult with other micro-resort developers, which is how I'm funding my lifestyle now.I think I would own and operate another project, but I'd want to hire a full-time manager that I could train to manage our operations.The Live Oak Lake project was an amazing project, a baptism by fire in the realms of <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/tips-real-estate-investing-expert-get-started-2024-2">real estate</a>, marketing, and hospitality. The price was right, so it made sense to sell it.Do you have a real estate story you want to share with Business Insider? Email <a target="_blank" href="mailto:ccheong@businessinsider.com">ccheong@businessinsider.com</a>

I built a 'tiny house' Airbnb hotel and sold it for $7 million. Here's why I decided to walk away when I did.

<ul class="summary-list"><li>Existing home sales dropped 1% last month to the lowest level since October 2010.</li><li>Homebuyers stayed on the sideline in anticipation of lower mortgage rates.</li></ul>US existing-home sales dropped to a nearly 14-year low in September as prospective homebuyers held back in anticipation of lower mortgage rates.Last month's sales <a target="_blank" href="https://www.nar.realtor/newsroom/existing-home-sales-slid-1-0-in-september">dropped 1%</a> to an annual rate of 3.84 million, the National Association of Realtors disclosed on Wednesday. That marked the lowest level since October 2010, and came in below projected estimates of 3.88 million, according to economists surveyed by <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-10-23/us-previously-owned-home-sales-fall-to-an-almost-14-year-low?srnd=homepage-americas">Bloomberg</a>.The decline to a multi-year low shows that buyers have opted to wait for home borrowing costs to descend, as typically happens when the Federal Reserve eases interest rates.It was widely assumed that US bond yields — and as well as mortgage rates, which are correlated with them — would fall after the Fed's rate cuts. Instead the opposite has happened. Both are up sharply since Sept. 18.According to <a target="_blank" href="https://www.mortgagenewsdaily.com/mortgage-rates/30-year-fixed">Mortgage News Daily</a>, the average 30-year fixed mortgage rate has climbed 70 basis points since then, to 6.85% from 6.15%.This is because stronger-than-expected economic data has forced investors to adjust their outlooks for how much the Fed is going to cut rates going forward. Since monetary easing generally leads to lower yields, the mounting prospect that the Fed will pump the brakes on further cuts is instead pushing yields higher.As for those prospective homebuyers are holding out for lower mortgage rates — if this trend continues, they will be waiting for a while.On a broader basis, elevated mortgage rates have been among several factors squeezing housing affordability. The high-rate environment has meant fewer sellers, draining home inventory and keeping prices high.According to <a target="_blank" href="https://www.redfin.com/news/home-price-index-september-2024/">Redfin</a>, home prices grew 0.5% month-to-month in September, marking the fastest pace since April."There are around 20% fewer homes on the market today than there were five years ago, mainly because so many homeowners locked in a low mortgage rate during the pandemic," Redfin senior economist <a target="_blank" href="https://www.redfin.com/news/author/sheharyarbokhari/">Sheharyar Bokhari</a> said in the report. "With mortgage rates back above 6.5% this month — and unlikely to drop below 6% this year —home prices will likely continue their consistent climb until more inventory comes onto the market in the spring."

Existing home sales hit a 14-year low as homebuyers hold out for lower rates that may not come

An NYC carriage house from the 1800s once home to an Astor family heir is on sale for $7 million &mdash; take a look

The residential market shows a positive outlook, with 51% of stakeholders predicting higher sales over the next six months. However, a notable 24% expect stability, while 25% predict a potential decrease, reflecting a balanced yet cautious sentiment, as per a recent <keyword id="19895043" type="General" weightage="20" keywordseo="Knight-Frank" source="keywords" meta.keywordsubtype="org" meta.entityname="Knight Frank" meta.hostid="261" meta.entityid="Knight Frank">Knight Frank</keyword> report. The outlook for residential launches is also positive, with 61% expecting an increase, suggesting continued demand. A more tempered view is held by 20% of respondents who expect stability, and 19% foresee a decrease in launches. The Indian <keyword id="20152263" type="General" weightage="20" keywordseo="real-estate-sector" source="keywords">real estate sector</keyword> continues to reflect a positive outlook for the near future, though with a more cautious approach. In terms of pricing, 63% of stakeholders expect a rise, but 36% anticipate stable prices, and a very small minority predict a decline. G Hari Babu, National President, National Real Estate Development Council (<keyword id="20429653" type="General" weightage="20" keywordseo="naredco" source="keywords">NAREDCO</keyword>), said, "The residential and office markets continue to show notable activity, signaling ongoing growth and opportunity. Developers and other key stakeholders, including banks and financial institutions, are maintaining a positive outlook." He added, "This suggests that while there may be short-term challenges, the sector is well-positioned to adapt and thrive. The continued optimism and activity in the market highlight the sector's ability to sustain its momentum and drive forward, amidst changing conditions." The <keyword id="22822547" type="General" weightage="20" keywordseo="office-leasing-market" source="keywords">office leasing market</keyword> shows signs of strong recovery, with 63% of respondents predicting an increase in leasing activity, driven by positive business sentiments and <keyword id="21313740" type="General" weightage="20" keywordseo="economic-revival" source="keywords">economic revival</keyword>. However, 24% expect stability, and 13% foresee a decline. New office supply also remains a point of interest, with 47% expecting an increase, while 29% anticipate stability, and 24% forecast a decrease. Furthermore, 67% of stakeholders expect office rents to rise, signaling confidence in the market's ongoing growth, even as 27% anticipate stable rents and 7% expect a decrease. The <keyword id="20635920" type="General" weightage="20" keywordseo="future-sentiment-score" source="keywords">Future Sentiment Score</keyword>, which measures stakeholders' outlook over the next six months, saw adjustments across various regions. The North Zone score slightly decreased from 65 in Q1 2024 to 63 in Q2 2024, though it remains firmly optimistic. The South Zone witnessed a more significant drop from 76 to 65, signaling a moderated outlook. In the East Zone, the score fell from 77 to 65, largely influenced by the discontinuation of the 2% stamp duty cut. The West Zone also saw moderation, with the score dipping from 73 to 66, though it too, remains optimistic. The overall Developer Future Sentiment score decreased from 72 to 61, reflecting a more guarded approach. Developers, while cautious, continue to remain optimistic due to strong sales since early 2023. On the other hand, the Non-Developer Future Sentiment core, which includes financial institutions and PE funds, also moderated from 73 to 68. This shift indicates stakeholders' careful consideration of macroeconomic concerns. Optimism in India's broader economic scenario remains strong, with 59% of respondents expecting an improvement, reflecting confidence in the country's economic resilience. However, 24% foresee stability, and 17% predict a decline, underscoring global economic uncertainties. Meanwhile, 51% of respondents anticipate increased funding availability for real estate investments, reflecting continued confidence in the financial sector's support for the real estate market. Shishir Baijal, Chairman and Managing Director of Knight Frank India Pvt Ltd, noted, "As we transition through 2024, a host of factors are playing out globally. The global economic landscape shows resilience despite ongoing challenges. Inflation rates are gradually aligning with central bank targets, enabling a more supportive monetary policy. India, benefiting from stable post-election conditions, remains a strong growth beacon." He added, "Domestic consumption is robust, supported by consumer loans, though there are some signs of growth moderation. Food inflationary pressures persist, but are converging overall towards price stability targets. With a projected GDP growth rate of 7.2% for FY 2025, India's outlook remains positive. An effective monetary policy by the Reserve Bank of India has helped sustain growth with price stability, positioning India as one of the fastest-growing large economies globally." The Current Sentiment score, which reflects stakeholders' view of the market compared to six months ago, moderated from a decadal high of 72 in Q1 2024 to 65 in Q2 2024. This suggests a more measured outlook as stakeholders navigate evolving global economic conditions. Despite the dip, the score remains indicative of optimism. Looking forward, the Future Sentiment index also adjusted from 73 in Q1 2024 to 65 in Q2 2024, signaling a positive yet more conservative outlook for the near term. While macroeconomic uncertainties may dampen enthusiasm, stakeholders continue to show confidence in the sector's resilience and adaptability.

Despite budget provisions, residential housing market will see sales growth, notes recent report by Knight Frank

<ul class="summary-list"><li>The Fed's interest rate cut will ease financing conditions for homebuilders, analysts told BI.</li><li>But other issues will keep supply constrained, from material costs to labor shortages.</li></ul>The Federal Reserve's rate cut will surely impact the housing market, but its effect likely won't affect arguably the most important part of the equation: keeping affordability tight. To be sure, elevated borrowing costs are partially to blame for the affordability crisis plaguing US home buyers, and lowering them will offer relief.Rates soared to multi-decade highs a year ago, and further reductions in the Fed's benchmark rate should help bring borrowing costs down over time. However, it'll also add to the supply-demand imbalance, as more buyers are lured off the sidelines by cheaper mortgages. Pressures will rise for <a target="_blank" class="" href="https://www.businessinsider.com/us-housing-affordability-home-shortage-market-construction-population-cities-zillow-2024-6">new housing construction to meet demand</a>, but financing is still tight for home builders, stifling momentum to bring more housing online.According to the National Association of Home Builders, manufacturing loans climbed from near 5% lows to 13% since March 2022."The more immediate effect for housing from the rate cut is going to be seen in the builder and the land developer loan conditions," Danushka Nanayakkara-Skillington, NAHB's associate vice president of forecasting, told Business Insider.But how this translates into a much-needed supply boost is a different story, and there are factors the Fed cut won't fix.Lingering uncertaintiesFor instance, Nanayakkara-Skillington noted that material pricing, from drywall to steel mill products, has weighed heavily on homebuilders since the pandemic.While <a target="_blank" href="https://markets.businessinsider.com/news/commodities/lumber-prices-plunge-home-building-season-demand-falls-flat-2024-6">lumber costs</a> have normalized, she expects a <a target="_blank" href="https://www.nahb.org/blog/2024/08/canadian-lumber-tariffs">recent tariff hike</a> on Canadian wood to increase prices in the coming months.Tariffs on Chinese transformers — which NAHB considers a "<a target="_blank" href="https://www.nahb.org/advocacy/top-priorities/material-costs/transformers">sorely</a>" needed component delaying housing projects — have caused prices to jump 73% in the last four years, she said.There are also shortages to consider. Nanayakkara-Skillington cited that 57% of surveyed homebuilders say there are not enough lots to build on, adding pricing pressure to the available supply.Urban Institute senior fellow Michael Neal told BI that local regulation is needed to remedy this issue. Zoning challenges should be addressed to unleash lot availability, he said, while inspection costs and timelines should be reduced.But the biggest issue is a lack of skilled workers, Nanayakkara-Skillington said. "Because we lost about a million construction workers during the Great Recession, we still lack that. So we need people desperately to come into the trades," she said, citing that there are about 250,000 open jobs right now.Nonetheless, the Fed cuts should improve homebuilder sentiment in the coming months after a period of declines amid high borrowing costs, both analysts said. Dim views on existing homesWhile it's difficult to forecast when the housing market will come back into balance, much depends on whether lower rates entice homeowners to start selling.According to Fitch Ratings, that's unlikely for now.Since most owners hold a mortgage rate well below the current 6% level, mortgage rates will need to fall significantly lower to boost supply, which will only happen if the Fed keeps cutting. The rating agency noted that about 24% of outstanding mortgages are priced above 5%, meaning that homeowners will stay put until rates hit that level. This won't happen until 2027, Fitch said."While new home inventory has grown by 29% since the start of the pandemic, improving the supply of existing homes, which are approximately 80% housing sales, is necessary to improve prices and housing market activity," the agency said.At the same time, easing Fed policy might not stir housing activity for another reason, Neal said."Part of the Fed's decision, I think, reflected concerns about whether or not people will have jobs," he noted. "At the same time, if you think rates are going to fall today, do you think rates are going to fall tomorrow?"This thinking might cause people to delay further, he said.Wherever supply comes to stand, a knock-on effect of lower rates and higher builder sentiment may be felt in the stock market. In the past three of five rate cutting cycles, the bank noted that homebuilder shares outperformed the S&amp;P 500 in the three-months following the first cut.

Rate cuts might make it cheaper to buy a house, but they won't fix the US housing market's biggest problem 

The <keyword id="20759748" type="General" weightage="20" keywordseo="housing-market" source="keywords">housing market</keyword> is in the midst of its biggest slowdown since the pandemic, according to <keyword id="23342837" type="General" weightage="20" keywordseo="Redfin" source="keywords" meta.keywordsubtype="org" meta.entityname="Redfin" meta.hostid="261" meta.entityid="Redfin">Redfin</keyword>. The real-estate listings firm <a target="_blank" class="" href="https://www.redfin.com/news/sales-speed-stale-listings-august-2024/">cited</a> that 48% of US <keyword id="23342838" type="General" weightage="20" keywordseo="home-listings" source="keywords">home listings</keyword> stayed on the market longer than 60 days in August, the biggest share since 2019. The figure marks a 43% increase from the year before. It's also the fifth straight month where the share of homes on the market that long has climbed — a sign that more houses are growing stale as demand cools. The summer also tends to be a weak month for home sales, adding to the standstill, the report said. Existing home sales slumped another 1% in August to their lowest levels since May 2020, when the housing market shuttered to a halt as the result of the pandemic, the firm said in a separate <a target="_blank" href="https://www.redfin.com/news/home-sales-lowest-since-pandemic-2024/">report</a>. Towns in Florida and Texas dominated the list of slowest housing markets in the US. Homes stayed on the market for the longest in West Palm Beach, Florida, with listings taking a median 79 days before being sold. That was followed by Fort Lauderdale, Florida, and Jacksonville, Florida, where homes stayed on the market for a median 75 and 65 days respectively. "We usually see home sales pick up when <keyword id="19979912" type="General" weightage="20" keywordseo="mortgage-rates" source="keywords">mortgage rates</keyword> fall, but this year we are seeing the opposite — sales are dropping and homes are sitting longer on the market," Sheharyar Bokhari, a Redfin senior economist, said in a statement. He continued: "Last week's big interest rate cut by the Federal Reserve will give buyers a boost in confidence, but it remains to be seen whether sales will speed up in any meaningful way as we move into the slower Fall season." The central bank <a target="_blank" class="" href="https://www.businessinsider.com/federal-reserve-interest-rate-cuts-mortgage-investment-credit-savings-2024-9">cut interest rates 50 basis points</a> at their last policy meeting, which was expected to influence mortgage rates to tread lower. But borrowing costs will probably stay elevated over the near-term, forecasters say, with Redfin predicting the 30-year fixed mortgage rate will remain above 6% by the end of the year. Still, not all housing markets in the US have grown stale. Seattle was the hottest housing market in the nation last month, with homes staying on the market for a median of 12 days, per Redfin's report. That was followed by Indianapolis, Indiana, and Warren, Michigan, where homes stayed on the market for a median of 16 and 17 days, respectively. Daryl Fairweather, Redfin's chief economist, said buyers might also be pickier about the homes they make an offer on. "Anyone who has been paying attention to the housing market over the past few years knows that desirable homes sell right away," Fairweather said. "Now if a home is still on the market after a few weeks, buyers assume there's something wrong with it. That's why it's so important to price your home to move quickly. Buyers see the days on market and when it starts to tick up, it's like a scarlet letter." More sellers have resorted to slashing prices in a bid to attract buyers. The share of homes that saw a price cut in August rose to over 19%, Realtor.com said in a previous report, the highest share of homes with a price reduction in August in five years. Correction: September 26, 2024 — An earlier version of this story misspelled the name of Redfin's chief economist. She is Daryl Fairweather, not Darryl Fairweather. Additionally, a data point in the 12th paragraph was incorrectly cited as being from Redfin. It is from Realtor.com.

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